I should be exempt from filing CT taxes due to not living there for the entire year. Since I am in the military my home of record is CT, but I should not pay taxes?

[Carl]

Does your W-2 show CT state taxes withheld in box 17 for the tax year?

[m-marlow2093]

Not for the entire year, I was not notified to re-file exempt so I believe I had a couple months of state wages taken out. I have been filing exempt for 3-4 years now, so I was confused when I saw state taxes being taken out.

[levisncap89]

You pay taxes on your active duty earnings to your home of record state, not the state in which you are stationed. Assuming you meet all three prongs of the non-resident test for CT, you'll have to file a return to reclaim the improper withholding.

    If you meet all three conditions for being treated as a nonresident for the taxable year but you had Connecticut income tax withheld from your military pay in error, you must file Form CT-1040NR/PY to request a refund.  Complete Lines 1-5 following the directions on the form.  Enter “0” on Line 6 if you had no income from Connecticut sources.  Complete the rest of the form including the withholding information under section 3 of the return.  Attach a statement to the front of the return stating:

* That you did not have a permanent place of abode in Connecticut during the taxable year;
* The location and a description of the permanent place of abode you maintained outside Connecticut and the beginning and ending dates of your stay there; and
* The exact number of days you were in Connecticut during the taxable year.

[Carl]

I am assuming CT is your HOR? It should be, if that's the state in box 15 of your W-2.

[m-marlow2093]

Yes CT is my state of record, I cannot pay taxes on the state I am stationed in because I have been overseas since Sept 2016. I did not have to pay CT state taxes last year but this here it is saying that I owe some.

[RBBrittain]

The correct term is "state of legal residence", not HOR. See <a rel="nofollow" target="_blank" href="http://usacac.army.mil/sites/default/files/documents/sja/legal_residence.pdf">http://usacac.army.mil...>

[levisncap89]

It's actually "domicile", but for military purposes, you have to indicate that by certifying your domicile to your personnel office as your HOR.

[Carl]

HOR is the military member's state of legal residence. Has nothing to do with their domicile or mailing address.

[levisncap89]

Domicile and state of legal residence are actually legally interchangeable. HOR is technically the state from which you entered AD, but when you go to personnel to indicate your state of legal residence, they will refer to it as HOR. Anyway, we're getting pedantic. From CT's standpoint, the guy is a non-resident for tax purposes regardless of his state of domicile.

[RBBrittain]

SLR for military purposes may OR may not be the same as HOR; see the link I posted. (Note that it does *not* mention the Military Spouses Residency Relief Act, so the complete law for military spouses is different.)

[Carl]

Generally I've seen the term "SLR" used when referring to the state of legal residence of the non-military spouse, and HOR used for the military member. Like you said, it's all pandemic. If you ever served, you know how it works. You can go to the MPO and ask 5 different people the same exact question and get 6 different answers. The scary part is, not a one of those answers will necessarily be wrong either.

[levisncap89]

touches finger to nose. You nailed it 🙂

[RBBrittain]

The problem is (a) people have been saying "HOR" instead of "SLR" for so long that they don't know the difference, and (b) if you never change your SLR it usually defaults to your HOR. The issue came up here several years ago, which is how I know the difference.

[Carl]

The following is from http://www.ct.gov/drs/cwp/view.asp?a=1462&Q=266282&PM=1

If you meet all three conditions for being treated as a nonresident for the taxable year but you had Connecticut income tax withheld from your military pay in error, you must file Form CT-1040NR/PY to request a refund.  Complete Lines 1-5 following the directions on the form.  Enter “0” on Line 6 if you had no income from Connecticut sources.  Complete the rest of the form including the withholding information under section 3 of the return.  Attach a statement to the front of the return stating:

1. That you did not have a permanent place of abode in Connecticut during the taxable year;
2. The location and a description of the permanent place of abode you maintained outside Connecticut and the beginning and ending dates of your stay there; and
3. The exact number of days you were in Connecticut during the taxable year.

Get the CT-1040NR/PY form at http://www.ct.gov/drs/lib/drs/forms/1-2016/incometax/ct-1040nrpy.pdf if it's not included with the TurboTax state module.